Earnings call transcript Q4 2022

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Operator

Good morning, and welcome to the Assured Guaranty Ltd. Fourth Quarter and Full Year 2022 Earnings Conference Call. My name is Lauren, and I'll be the operator for today's call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. that is note recorded. Please Instructions] this being event [Operator

Communications. conference to our Director, I Corporate like the Investor go over and Managing would now Senior turn to ahead. Tucker, host, Relations Please Robert

Robert Tucker

Securities operator, the our quarter conference safe business of for and call. Litigation harbor financial of new you, statements The Assured financial is about presentation Private spreads, end fourth and may for provisions credit and presentation results items all Thank that reserves, forward-looking joining outlooks, you Reform may future made Guaranty contain credit Today's XXXX year results financial thank affect pursuant the Act XXXX. other loss conditions, market our our ratings, results. or to

new should we publicly Therefore, information or These as are obligation undertake them, statements future except not them by as undue required to you reliance do on not or revise to any law. subject to update due place events. change

you call, most for to listening financial our today you're If updated website filings please may Investor factors. note Please to recent Information have our the the and since statements presentations the if a for the of section that made refer been most of filings, this transcript risk of call. call, this our or SEC are replay and reading current

assuredguaranty.com. reconciliation investor comparable at our financial a supplement and This directly with financial non-GAAP the to are in presentation, measures presentation also financial includes presentation, in which on references measures along to non-GAAP financial GAAP financial current GAAP measures such measures. We most equity and website our this present referenced between the non-GAAP

remarks, Officer. Dominic Chief of Executive and Guaranty to questions. Rob the Bailenson, your their the to Assured are Financial Frederico, and President Chief presentation, we'll call Officer Turning speakers our Limited; our After open today

for question. is the webcast please enabled the to a not ask call you'd if dial like into Q&A, As

will I call over turn Dominic. the now to

Dominic Frederico

today's Robert, to everyone and welcome joining you, call. Thank

in XXXX. well a very exceptionally volatile performed Guaranty Assured

international XXXX. finance, million Finance, production financial PVP. finance, in businesses produce in infrastructure public combined fifth $XXX more generated and which of business Structured million The year guarantee Our U.S. PVP $XXX to consecutive total than Global of new

We bond nearly the our record insured to municipal previous issue U.S. with share lead continue insurance new of sold equal of share year's par to the XX%. industry

trades XXX secondary market over in produced amount not billion and bond par up the par $X.X XXX% Our insured a municipal U.S. decade. a in seen of year-over-year

operating to Topping During even the year-end year of previous key brought year, we losses new due returned the $XX.XX We set book investment in portfolio. to increased in new X% per per X% unrealized in a rose adjusted value XXXX, value and measures share and though Rob per highs dividends, and to record will to shareholder say to shareholder repurchases share declined share share to which $XXX X% adjusted more about. per shareholders the total high $XX.XX (ph) share to of shareholders' equity million $XXX.XX.

end The represented our share of outstanding. nearly year XXXX repurchases shares XX%

previously quarterly common increase which our of per and been has over last dividend dividend we addition, the declared increased. XXth $X.XX quarterly In share, XX% that a share represents our consecutive of $XX common an of year per dividend of week

Puerto the when net combined of our $X.X insured outstanding. of agreements which and billion our portfolio, Rico Rico below Commonwealth all, settlement for eliminated insured to defaulted our Puerto one but the amortization, investment-grade in Rico reached to We entities of with exposure normal par Puerto

settlements. we or were portion also in the We of the a received on sold off paid securities

economic and stress. environment challenges rising currency economic and set and a a XXXX, markets new markets, geopolitical volatile Our during the trends uncertain rates, interest year inflation, marked presented financial of by

decrease significantly, in portion. its overall of our income refundings the volume It fixed market primary an in is and the reason also For losses investment unrealized interest portfolio. insured which example, to led market important both caused the rise rates declined rapid U.S. that to in municipal

the rapid U.S. deferred denominated amortization foreign amount the foreign non-U.S. the of business. PVP exposures, in revenue the our those could from premium For amount a new and reduced earnings strengthening value dollar given UK of of business, the dollar versus of record pound currencies, sterling, dollars for from international we especially premiums of

of million headwinds, billion an diversified finance face structured result bonds a our down $XXX billion from totaled in the markets. public XXXX, U.S. of across XX% it $XXX and of In record amount in such of was finance our was impressive well $XXX XXXX. Issuance and municipal PVP par

impacted particularly benefits insurance by and bond in X% reached bond value consecutive unpredictable COVID see levels well was pre-pandemic second indicates that an saw above the continue rate to activity for issuers and Nevertheless, rates. is penetration the year, firsthand of its industry the higher who investors Refunding crisis during insurance for the year world. which

X.X%, the XXXX industry's since penetration rate is fourth since third quarter insurance fourth bond in It XXXX, encouraging all and that highest reached quarter the highest rate penetration of penetration quarters of the XXXX.

industry's Guaranty's par we a XXXX new We was Assured sold. a XX% behind ensured in achieved force XX% share XXXX. market nearly quarter leading the of performance production fourth the for as of insured issue

market the secondary in lack -- supply, higher XXX% Additionally, issue turned we the as to the than was to for of make secondary market investors par insured XXXX comparative XXXX. in up new

flexibility. As our investors bond combined primary markets, interest $XX and market secondary liquidity billion. sold we management prices insurance portfolio useful and market par fell, seeking secondary insurance was In municipal surged of upward the and on for rates

combined Our totaled $XXX PVP public U.S. finance million.

this insured in whose projects. $XXX XXXX issue transaction, in issues strategic the which XX and we hospital issued launched financing Louisville-based are University Healthcare issued of Our health insured for bonds Financing which about revenue tax taxable of par We of XXXX Health. Louisville par. million $XXX in or Year least of we the of exempt major The included one insured was both two-thirds two Buyer's proceeds at care million This transactions Bond Deal in

transmission the power part million bonds private projects. that partnership bonds improvement project exempt activity the $X.X of support all $XXX improvement Pennsylvania bridges. as authority issued In we $XXX public/private another, we Department State of and one of the to and support billion of issued reconstruction New of ensured York example, of revenue of million tax aging green insured transmission rehabilitation, financing to In Transportation's of construction the

payments, As partnerships. of ensure increased financial including underwriting federal guarantee large sector infrastructure projects, well our also spending this strength principal important of Assured as scale should for only and and experience years bring provides capacity not We impetus our financing large opportunities for can public/private our present project as interest credits, to but timely infrastructure Guaranty.

credits year add billion Moody's, in of ratings category six row. ensuring of AA insured underlying from continue $XX our years up with United AA one or and to value has a such PVP the from we both last XXX Moreover, transactions, XXX on of States, S&P totaling performer, finance par. the in business million public become for a Outside $X.X more than producing consistent and

to million of and this XXXX, first finance transactions of the a currencies strong PVP after large converting The major half in In is pipeline regulated highly and market related utilities negative of secondary to public Among accomplishments foreign were of lead $XX that a we UK within to impacts business, our deals XXXX. dollars. non-U.S. could wrote likely airport. notable U.S.

XXXX. Europe which effectively, more Our business originations power in subsidiary, serve further opened grew to we Continental in its XXXX

to which XXXX direct and an Structured second Providing year productive important in be Finance, structured we since million Global banks wrote continues XXXX. institutions finance In makes our to capital most utilization like Guaranty. PVP, companies optimize risk insurance $XX for Assured tools activity for focus and syndicate

insurance transfer, securitizations. several During the year, commercial risk whole we including CLOs transactions closed and estate, real sectors, in business

agreements during private remembered to be equity by to will our Authority them subscription of where we and investors' style certain Puerto the the credit commitments. exposure XXXX during our quality, the as Authority, of its on corporations. to Buildings settlement high other And Transportation we made Public portfolio. and Highway insurance inroads further Also Rico, of year finance bonds further Commonwealth (ph) we its public funds the year, with provide funding Also its finalized work diversified banks strengthened XXXX, help into collateralized well

with instruments some Although the credit, vary the Rico were potential on based Puerto the and overall, terms mix securities, settlement value upside the settlements a in economy. have compensated cash of including continuous that performance by we of

of We the opportunities and received some securities we to have sold the arise. market continue do as so

Rico defaulted unsettled Puerto which Power remaining resolved Authority, is be year. exposure the PREPA, we last this Our Electric believe could

the Primarily since as of $X in investment Puerto the a million to just grade X.X%, we result from $XXX the outstanding par net resolving XXXX. level have AGM of reducing plus Rico substantially settlements exposure, reduced -- our normal lowest our we par from amortization, billion below portion acquired the including substantially

S&P plus Both at look agencies cited ratings of to affirmations reduced in our Kroll rating Global Rating and XXXX our ratings both Rico. positively Agency Bond outlooks. their S&P at on Ratings Puerto and stable AA with during exposure AA KBRA, The

our we currently value for this Management for our business In to alternatives Asset maximize exploring business, stakeholders. strategic are

in We Asset are are seeking grow to Management investments strategic for investing strategies business earnings. alternative committed this accretive and our to and to alternative objective related

of with which ended IM to of XXXX. XXXX Assured $XX.X management, was billion essentially flat under that assets

and was of were certain runoff and Ukraine, the limitations other and of the financial well the the by during Third-party CLO year. billion impacted and following as asset the for global as our spreads inflows we challenging legacy widening typical were $X.X markets, many economy funds of gross the invasion managers, as

the important we to December course We $X as December to its $XX.X increased important Assured three is on acquiring ago, IM mind Assured business and billion since IM keep XXXX. funds have XX, XXXX, corrections only XX, It from AUM to just made years in of successful strategies. earning fee that billion of

from in date, reduced year $XXX end the since the to $X.X we down XXXX. billion acquisition funds, AUM at million wind Additionally,

COVID this municipal stage, increased no sustained economic lows our of us more In product a normal, PVP. originating of sustainable more rates indicates even proposition, that that will widespread believe, value We was onset world while with has We a to offer with in saw becoming showing potential the became a understanding which for savings the signs issuers XXXX in insurance penetration have year. we clear greater we a our interest of stable. the recent more been It believe increased historic levels, giving rise bond to prolonged our issuance. even more than of demand lower years remarkable view, period from began support traditional of

in United began own public/private as their impact bonds The great to federal experience Infrastructure municipalities potentially insurance encourages capabilities it insurance value Bipartisan bond business market municipal market value The funding incentivizes we exemplifies success of versatility with financings, and to add growing of our and in to and partnership finance the can complement and bond can of secondary we Act financial strength. investments, diligence ensure, analytical funded the typically volatile experience, the with infrastructure due our awareness conditions. States of which our

again to our we most our mitigation the model. our loss our of engage resilience resolved our insured commitment most the our in of Perhaps importantly, our act best and exposure, of interest the stakeholders, with responsibly Rico demonstrating of to strategies, effectiveness obligors determination Puerto business

As in are business we enter we a to solid new start off XXXX, production.

forward, we expand always well for our have we our insured savings in and positioned capital. ahead and shareholders issuers, we the manage and growth Looking prudently because opportunities for actively produce years a broaden and risk investors what done, disciplined are management, underwriting protect through markets do and will

to now will the turn Rob. call I over

Robert Bailenson

Dominic, everyone Thank morning good call. on to and you, the

premium against start me substantially business strong our primary Before offset production lines, This year's we review new let $XXX refunding. I all and issuance. results, finance by long-term adds million business achievements across strategic revenue of XXXX, to highlighting had market initiatives. reduced despite year's public PVP our and deferred In amortization scheduled our this

the par Rico net Puerto of since investment Rico The XXXX lowest outstanding, X.X% of reduced one all defaulting total grade to but level par the resolutions and XXXX. exposures only extinguished below Puerto total

bonds As cash, a part with Puerto and received value of settlements the combination contingent Rico, of we recovery instruments.

we these or by paydowns. XX% through As securities of sales almost have reduced to exposure our today,

of which the common share. beginning of of shareholders, we Also at a capital the of XXXX, shares is year, to dividends. Share XX% retired return $XXX value helped new X.X book of to to to or declared which the million boost $XX a $XXX adjusted in million almost repurchases in shares represented addition record outstanding million per

increase an approved quarterly from per rate in share Board $X.XX share, up the the per XXXX, XXXX. $X.XX in For to dividend

XX% business billion, look finally, steady business. Management asset fee maintained of pursuing Asset forward $XX.X And net accretive our management is earning to of business to strategies earnings. increase growth AUM related in which We this

operating XXXX. income operating basis. compares in or per year $X.XX XXXX $XXX XXXX of Turning full a primary Insurance per pleased million adjusted million came The the segment, loss operating from component adjusted to is drivers our largest to which $XXX alternative report $XXX million share the on in share, investments. of annual compared $X.XX in and I'm income XXXX variance had year-over-year expense The $XXX which income. results adjusted with million of with or of

Loss deferred loss offset million both $XX expense, of function a U.S. and with mainly of in benefit which $XXX in expense RMBS consisted a compared million development XXXX. in of million, public expense finance economic $XXX is was $XXX benefit revenue, XXXX million. premium amortization of partially of by a XXXX

higher as benefits of performance, continue the million, higher related transactions Net loans, of public economic and associated discount loss benefit development for recoveries efforts a for $XXX RMBS we million benefit transactions economic benefit finance mitigation primarily a from rates. $XXX see million charge-off consisting to $XX for XXXX with improved loss was to a U.S. and

loss difference a rates resulted development and attributable XXXX. in revenue rising all extinguished $XXX the of of expense public Puerto transactions. finance benefit discount is between Across for The sectors, the economic deferred in million on of net impact mainly to Rico acceleration transactions premium

in $XXX transactions. the U.S. for consisted XXXX year's reflected $XX million of Rico million expense mainly The finance which for RMBS benefit Puerto of transactions, of benefit an certainty million outcome benefit the loss last of and resolutions increased $XXX public

Rico With portfolio. Rico, PREPA, no defaulting negotiations for aside our other exposures are unresolved in insured continue, respect to from Puerto Puerto which there

HTA amounts to represents owed to and payments. accelerated not did Our geos net exposure receive who service bondholders par remaining debt insured

investments the in in of types XXXX segment adjusted mark-to-market loss gain million our of the variance These with in to driver compared main income operating of alternative fixed $XX investment fixed income portfolio. volatility XXXX. more investments, compared other the alternative in year-over-year The was in Insurance $XXX is a of -- on a income million maturity periodic result which

remain funds $XXX a we excess on investment returns generated Assured December X.X% of We inception through have maturity cumulative to investment IM alternative committed million But representing by where portfolio. expect XXXX, those basis, gains the a fixed of from strategies return. pretax in XX, annualized

which XXXX Insurance increased the $XX from in XXXX. million $XXX segment to of of million accelerations related total Net includes the million earned Rico of exposures premiums of to in $XXX XXXX, in in due to certain XXXX. extinguishment XX% refundings million $XXX million $XXX to This refundings in Puerto compared

the AUM XXXX year-over-year funds. adjusted Management outpaced segment, improved of opportunity million operating $X in from acquisition In fees fund lower reduced initiated with wind-down from of increasing adjusted Asset in Blue loss in of operating our million strategies results with were after loss as XXXX $XX Mountain fees compared that the

and adjusted XXXX. with a million taxable is income period. adjusted jurisdictions in did on period division income operating after-tax XXXX across including XXXX debt relatively rate compared loss X.X% varies from recur of in Corporate The operating to of year-over-year, extinguishment was the was XXXX $XXX consistent that XX.X% and in effective not in tax The function

mention U.S. relative effect I euro that the dollar the adjusted income. the British operating to a did and also not pound of on strength material against have wanted

rates However, in the did on material of also GAAP foreign losses movements value gains net book a and non-GAAP FX XXXX affect metrics. our in have income. all effect These exchange

for shares as a the recent XXXX $XXX undertaken an year share. of quarter several internal goal at able we capital last $XXX of other X.X XXXX, to years. without to initiatives share management result per of $XX.XX accomplish fourth special year's dividend in were bringing of had full average a capital terms million We repurchase our objectives, repurchased price million management million we In in repurchases

Since returned in shareholders under our our we program this repurchase total program, in to billion reduction XXXX, the of beginning in $X.X XX% have resulting a outstanding. shares

as is subsidiaries towards the liquidity. that remaining $XXX the is the depends now, the of timing insurance share accretive repurchase year. from dividend of as As the million. dividend initiatives repurchases the weighted insurance capacity may of year, holding availability well subsidiaries shares other second the This strategic of to require on of growth authorization of timing company half assessments The

have From $XXX approximately companies These liquidity for the needs resides currently a in available shares initiatives million the pursuit AGL. our investments expand which capital. for funds standpoint, and business strategic $XX cash use of our in to manage repurchase liquidity to holding our or of of are million, either or

Continued favorable shareholders' almost $XX per and increased our share have new development repurchases, with adjusted and operating records adjusted income, production new business operating share along value and share adjusted $XXX, equity respectively. of positive per to book loss

consistent from initiatives quarterly successful of term. how long period book period, results our in metrics the value to execution vary over increase build reflect strategic a value the While key operating these shareholder

I'll the you. instructions for now call turn the to the operator you the Q&A give period. to Thank over

Operator

you. Thank

first session. Dunn from Dowling Geoffrey, We will question-and-answer go the now begin question Geoffrey Our & [Operator please Instructions] ahead. Partners. comes from

Geoffrey Dunn

Thanks. Good morning.

Dominic Frederico

Geoff. morning, Good

Geoffrey Dunn

Dominic, to market rates. still we've where did and expectations. this evolved interest of are given with original can't thought is to and turning the not volatility growth I'm to that business, your improve strategic project has with curious you had as management initiatives But we the to the you guys importance respect respect asset obviously, And how business in a or scale always kind profit, this you additional this here? planning were of progressing you relative underestimate

Dominic Frederico

here two the in not that I as and won't it's answer case. say, that's thought obviously, we I'll quite sit exactly ways. Well, because

beginning commentary, we at it's develop to And how the scale further appreciate scale a business. and our we However, in continue profitability. look we can and talked that alternatives do from then we

been think I like organization. the to portfolio net-net the -- on with asset added the positive the -- we to narrowed you But not still it's As we've said, that and the we're we've on done. management side, see, create loss able the returns

So the strategic continue very scale to continue guarantee strong for market and develop as great we think more great earnings, course, to that company to are a this significantly subject business, a profitability, really conditions. opportunity we get non-financial grow and diversification which, is of to

a those is market typically market when volatile, kind hedge against of Asset does This business the conditions because most better. Management the the is

risk revenue very And that and we build our that look achieve we're thinking the into we plan. increase in we're appreciate it of to scale so results what business, to we as related, continue going to how opportunities not we're and fits that's on. can strategic at confident it So scale, revenue the

Geoffrey Dunn

is Okay. think million target a you've And then years. out year for And buyback as that you management, the your still But investments $XXX And several target hitting additional think in, do capital comment resources? that in management target dividend about as you about you et year had cetera. asset 'XX, did Rob, weigh hear I for a 'XX? capacity, about how against

Dominic Frederico

So right? that's most is we see low, very, question can Well, most time. day, was stock the transactions of do. execute historically, And of can good the consider what the we accretive we buyback very a where at the the was transaction accretive obviously, stock

evaluating alternatives to a start to we continued that we'd today, and even on look of and other capitalize growth have As instead we the into we're and going opportunities accretion to that. see accelerate wind-down a the mode, mode company, like a better to

loaded. of So strategic the each still a this Obviously, we we The part year, at back-end objectives. alternatives our capacity capital is the is our strong weigh buyback. time management each look of dividend

activity the year. see -- latter the more half in the going the year of than part the of you're therefore, in So beginning to prior

we've French the transaction collapsing dividend capability, back, think back if starting subsidiary the supported the we And I'll episodic unique, buyback on, capacity really if took years, created. debt call, go you the that three that of and had MAC, in you what Geoff, the

us dividend. that special events episodic to number continue the without targeted had we've to to So get allowed a

operating somewhere real And happened. therefore, of you and with think this the things Rico year okay, special along still we Puerto going say, bed, I line. for the that's a relief. give and As need look large and that we at I'm dividend be the look at couple capacity, pause possible this even will and relevant if to a really year by will because One a regulator think dividend

that's been company. Even for Finally, issue, it's never headline economic the not an an yet risk there. though is the issue

the will When move we've also dividends, it two special had very gives issues another regulator results this those a past. go our would being positively we the to clear Two, audit then expect to think enhance things, year. we've real to back us which I buyback clear the I opportunity five-year to positive positive got capabilities. the and audit completed which for start decks, of audit in

Geoffrey Dunn

then, And question. just Okay. last

a In you I whereas play accretion, obviously, years. terms of management a benefit economic if how the platform immediate buyback? how that value over you to get several buyback, two say creation you think from acquire from better balance investment versus get may can you about mean, asset we the where an boost Management out you Asset over years do the several

Dominic Frederico

quicker too we on Okay. organization. looking here, a much effect have lot opportunity, accretion opportunities a Without at lot the accretion tipping of quicker hand we're a that

actually So it Obviously, and five short builds term. into immediate results a longer-term still at business, but is we I'm look guide do -- in I more still fruition we're root one invest This not the come watch days. saying years. an in these a need both.

that going have the more we're we things immediate of to do. So impacts

Geoffrey Dunn

Thanks. right. All

Dominic Frederico

Thanks, Geoff.

Operator

you. Thank

comes next go Brian Our question Meredith UBS. Brian, please ahead. from from

Brian Meredith

Thanks. Yeah.

a So quick of ones here. just couple

math kind less if First kind one, about just take my dividends million that buyback holding $XXX think you for just following you'd if I share without on that's company special, I of I'm right. Rob, management get capacity the have not year, question. obligations. sure of capital the of this

special you've a about get to thinking Is you you the think? PREPA dividend? you of do kind resolved, you're need for? got capacity a about do And that So do is have that to that then the requirement the number think

Dominic Frederico

the answer I'll half latter Rob. for

to special So get the I don’t resolution state. think, a request we -- a to resolve need dividend PREPA

we in 'XX, All outstanding. 'XX, heart 'XX. special right the in the back are go $X.X you had of right if those situation Rico 'XX time, dividends billion Puerto we think when of and in had I

reserved PREPA record So for Brian. very honest of that's course, with I issue schedule, being for think and I just the you, on to an speaks with adequately think left don't our itself, track be

audit issue an today, think that is us I more the to just for clear deck.

Brian Meredith

Perfect.

Robert Bailenson

at could XX, -- And our equity see And dividend is presentation having million you our company AGC Page $XXX obligations, you that if on limitation AGM a would Brian, million. look if look dividends the dividend. without at which about you for $XXX and holding if you special about be expenses plus

So that can gives available back us without of something that buy transactions internally. to roughly $XXX million stock other generate we

well. looking dividend are their do the at We from looking That's to based management as we're money that upon back capital policy UK. something

So that these to this enhance looking are all that dividend year to achieve things we're capacity.

Brian Meredith

that you I to... assuming you. was Got did

Dominic Frederico

Yeah, exactly.

at entire look the you If organization...

Robert Bailenson

see actually of its Re, you effectively. Re, is page because AG But still capacity negative with and the surplus look if zero dividend has Well, XX% on it's capital, at that's you for its can at that ask AG the it capital no regulator because permission.

However, at look assets you Re. have AG at its unencumbered as also well to

Dominic Frederico

did of don't [Multiple from to fact XX that lose Brian, I we Speakers] million XXX million. outstanding shares the down sight take

allowance. these of So more last want over that for you years. We've children pretty good given a you're little your allowance like couple

end the success the bit and reduced. at look be the So the you a But little might day, your track at allowance of record.

Robert Bailenson

perfect. That's

Dominic Frederico

make Don't corner. you put me the in

Brian Meredith

in think to What having loss pretty kind quarter more to rationale behind I the but the little of Puerto increase related you the was in Rob, bit Rico a the well, just walked on Excellent. it Insurance maybe exposures? reserves And segment. through then, Okay.

Robert Bailenson

And rationale and you then scenarios competitors quarter, within all happens scenarios financial our weights Puerto scenarios. an Well, if into change adjusted an we and that our of to and scenarios see one of entered was at those agreement agreement, with we the there public. the where -- guarantor what one -- where Rico obviously, your And your another evaluated you or announcement what's that accordingly. we look add our -- The was the is have additional information another or evaluate you on rationale?

Dominic Frederico

At Remember, day, what think and relative the going the strong. end Brian, hearings current especially that's on arguments with going right? feelings are there if get where feelings you my me, pretty PREPA, to we're on are, positive my on the asked non-recourse the the to to of fairly lean, GAAP, I are

to of municipal don't entire Judge Swain I history revenue think wants the bonds. reverse

confident So relative confident a that could going those appreciate. turn to to to and can the hearing have on issues, a or good least you confirmation thing at I'm dime we're that somewhat the two relative as pretty this well of plan

get our gets waiting relative do become information expecting and out therefore, you have to to the possible reserves end a was And it We're are that in included what factors reserve. the of MBIA So the settlement. one public we our therefore, GAAP. at conditional that's which there, the day, of the has of analysis and scenarios

Brian Meredith

profile should last PVP Makes it question, into slowdown in if see we year, think it that we of the happens? potentially there's does forward? that? play as a then like think this necessarily chance kind macroeconomic we How Does curious, Should about And recession. a of Thanks. outlook look matter? How that just business you about if sense. looks your

Dominic Frederico

and getting think older recessions and older three I longer here, of at Well, tooth older and tenure. suffered the as over I've my in I'm the the end day,

the player, in So municipal that thing on space, Obviously, we're insured activity not the a really large a The concerns only each obviously company. since of impact for a us had bonds. material such market municipal bond direct volume effect. is has really have the them that

a still in of year, and still we as a PVP, those last continue even with positive But finance talked businesses. two see in bit we you on those start little volumes significant we are down international, in the the a but a structured we solid XX%, had number, for still there a first to didn't opportunities. in is And call, start give diversified the quarter, we platform as XXXX growth

we're, that dollars. more gets will premium optimistic and stay longer, which a, higher So rates us

so money, premium Two, international paid diversified on finance more we debt and overall think international be opportunity issuers we can for but know, the for you save that of be that for there'll the organization. we markets insurance. higher infrastructure service. As public then might Volume compensate two creates it get the support more then searching down, to really and

So of as our the time, and And get in goal Asset and size overall still and finance business. financial well. grow opportunities grow at we'll business capacity same the to guarantee talked we the to we're as Management accretive at continuing the looking volume about, public

Brian Meredith

Great. It’s Thank you. helpful.

Dominic Frederico

Brian. Thanks,

Robert Bailenson

you. Thank

Operator

you. Thank

comes go question from from next Our Tommy McJoynt ahead. Tommy, KBW. please

Tommy McJoynt

my for Thanks guys. taking questions. morning, Good Hey.

Dominic Frederico

Tom. morning, Good

Tommy McJoynt

bit obviously Going conversations the obviously by you about the special dividend, the have think very regular get what dividend size capacity. side. that But as weighed formulaic. it's formulaic capital kind the with are of but special nature dividend a you when factors not on of potential on about think or back those we a regulators? It's when dividend

Dominic Frederico

Well, with as relationships them sure good concern. same Why? we've with done basically caused request exact Because make got never for our everything want the any does we've always thing. to said, dividend regulators. of We've right. special we've [indiscernible] We

don't say to say, aggressive, well, that's for So the regulator want stars, and I you the reach right? but sit there

also look on but it at we very how of So growth at we look a keep management, now managing we as systematic, to basis opportunities. periodic want capital

in a fit those measured has we'll want that and I make to we spectrums to regulator they've appreciate think be we within So sure Obviously, we approach. our established. do, the job

that in and continue been do we regard, will that. good we've soldier think to a I

audit, look we'll So Puerto it's long-term We're this the special year thing is get basis. an all as long-term at we've XXXX, think the be cetera., over gratification. Rico, It's the like to not this dividends back we look about, the to both issues new to talked buildup value obviously, of that et but We measuring a short because we opportunity We're for not to looking looking instant of for for our opportunities. term. shareholders look at a and approach. business

Tommy McJoynt

a to audit going time think And be do completed? point when you the for have is five-year you

Robert Bailenson

completed the be Yes, I end believe it the summer. should by of

Tommy McJoynt

Okay.

just -- to remain the just weighted close buybacks based that comments scale-down half the of to the being capacity year, version? the zero for your be half close of pause, of so on year And to is to that dividend or the kind a will first mean about second

Dominic Frederico

We'll said. back-end loaded, as we be

Tommy McJoynt

of my from in would have the guys Have guys needed a you given like what then And for that be of for the the capital rating AAA run excess on numbers kind what Okay. past you last estimate of 'XX? S&P. looks question, in it year-end as

Dominic Frederico

It's Of $X.X for year-end billion numbers. course, ran we the XXXX.

Tommy McJoynt

got flat So Thanks, year-over-year, it. guys.

Dominic Frederico

welcome. You’re

Operator

Thank you.

final Bologna please comes Point. Our from go ahead. Giuliano from Giuliano, question Compass

Giuliano Bologna

Good morning.

about think perspective? And rates go-forward a assuming and I'm much elevated the the for could that capital opportunity market how what large of from lowest curious remain on But the dollar a grow you I be there's Unipar questions that? basis a par curious, since kind of opportunities I'm digging on deployment if how One then would not basis, could up little you I'm was dial about bit think of obviously was guys the curious if a the gross -- into mistaken. able written. 'XX, XQ your business? mean I you issuance that was were to

Dominic Frederico

the that about still make we and like the of that this businesses up is marketplace. areas rates structure because think finance is or volume more businesses other secondary significant. Remember, about us, other for and I infrastructure allows can volume the right in businesses markets I allow it's international than us think Well, in it kind the opportunity

we're spreads of course, predominantly, with of to optimistic helps. come very and rates so that tend rates, because So

our basis, over BBB at As. XX% a looking penetration year, well rates look BBB at for the the and that are penetration XX% think I and and every for also single I the at significant. or like A look rates, it's if like We're the always transactional it's over insurers On fact you the this

gets market up as as thick go well. that rates So

So gives more even us that opportunity.

concerned to to the that's to where finance given got to about themselves. could there is volume can't going and a level because come run, substantially, of thing be although we're to The as the be. It's volume opportunity market, hold are them rates So who is, shut and they're can down that's I the right? of for the of time over ability or is. going where about long the spigot need to municipal opportunity a off rate volatility municipalities the a they The you borrowers finance nice off. access think that's got really it still are market, And the see to haul, period but

are is stay as So for higher that high, which for rates and rates longer, appears stay us, long us. as to it going great for

I think premium presents market opportunity then the growth. itself very for a continued strong

Giuliano Bologna

[indiscernible] a if let's of flow of which this [indiscernible] of be moving. how any curious But be the this capacity And investment keep year, year. that There towards around to ahead. funds things be if about counts income to will for AGUS, dividend jumping in income and I'm would your 'XX kind into That's that -- are on benefit there's kind on some great. then not given thinking questions

Dominic Frederico

Yeah. important us. We've we where and as Obviously, would to that so arises get company, objectives we holding strategic the profitability get It the that off on the need business. don't Asset the and based we move from look in hold matter Management income income fees on it and got I be for cash holdings to that's other opportunity can cash that. more AGL the whether around. It's ability management meet, at going AGUS to to is to

Giuliano Bologna

Speakers] [Multiple

Dominic Frederico

of to in some -- the a of I'm or sucking going are Tommy Remember, illiquid. sorry, for of of AGUS bit be kind assets funds period little time. They're

time. now, when sell an assets create So to maturity it a play, longer period we earnings they you the as cash look that to start of will come to of versus the of at That's some as ability Right funds. materialize actually cash out those earnings. within

Giuliano Bologna

jump to you much I’ll it. I and great. That’s the appreciate back very Thank queue.

Dominic Frederico

Thank welcome. You’re you.

Operator

turn like question-and-answer host, This Tucker, remarks. over concludes you. would to Thank I to now for the back our the conference Robert closing session.

Robert Tucker

joining operator. everyone I'd for Thank thank us like to you, on call. today's

you feel If questions, very free a to Thank call. have you much. additional please us give

Operator

today’s all you conference attending. call. concludes for Thank This

great now disconnect a may your lines. day. You Have

Assured Guaranty (AGO) 1 Mar 232022 Q4 Earnings call transcript